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The troubled crypto lender that has been dealing with a massive liquidity crisis, Celsius Network, has filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of New York.
Celsius released a statement late Wednesday:
“Today’s filing follows the difficult but necessary decision by Celsius last month to pause withdrawals, swaps, and transfers on its platform to stabilize its business and protect its customers. Without a pause, the acceleration of withdrawals would have allowed certain customers—those who were first to act—to be paid in full while leaving others behind to wait for Celsius to harvest value from illiquid or longer-term asset deployment activities before they receive a recovery.”
Alex Mashinsky, Celsius cofounder and CEO, said:
“This is the right decision for our community and company. We have a strong and experienced team in place to lead Celsius through this process. I am confident that when we look back at the history of Celsius, we will see this as a defining moment, where acting with resolve and confidence served the community and strengthened the future of the company.”